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The Controversy That Could Swing Ecuador’s Election

Reading Time: 4 minutesOutgoing President Rafael Correa’s mining deals have alienated groups that once supported him. That could cost his heir apparent on Sunday.
Reading Time: 4 minutes

Miguel Romero/Presidencia de la República. Sept. 28 2011 Wikicommons

Reading Time: 4 minutes

A decade ago, Rafael Correa was sworn in as president of Ecuador in the Andean village of Zumbahua. In the presence of fellow “pink tide” socialist presidents Hugo Chávez and Bolivia’s Evo Morales, five indigenous priests sprinkled him with sacred herbs and evoked the spirits of the moon and sun to provide him with positive energy. But as Ecuadoreans prepare to go to the polls this Sunday, his successor candidate can no longer count on the support of the country’s indigenous population. The blessing of Pachamama – the Andean Mother Earth – has deserted him.

“We will vote to reject correaismo,” Carlos Pérez Guartambel, a leader of indigenous party Pachakutik, told AQ. “(Correa) has plundered indigenous symbols and beliefs. He has prostituted his principles by supporting large-scale mining projects and violating the profound connection with Pachamama.”

A year ago, an opposition victory in the 2017 Ecuadorean elections seemed unlikely. The Alianza PAIS (AP) coalition that Correa created has dominated politics for the last ten years, and won a healthy majority of seats in the national assembly in first round voting on Feb. 19. However the AP’s presidential candidate, Lenín Moreno, fell just short of the 40 percent of votes required to avoid a run-off. In the weeks since, the country’s smaller parties have almost universally declared that they will vote against him in the second round on April 2, in a repudiation of Correa’s legacy.

In the final count before Sunday’s vote, local pollster Cedatos registered voter intention for Moreno at 52.4 percent, with first-round runner up Guillermo Lasso, a former banker from the coastal city of Guayaquil, at 47.6 percent.

“The final polls are surprising but we expect Lasso to win a narrow victory in the run-off, following declarations in his support from other parties,” Laura Sharkey, Andean Analyst for political risk consultants Control Risks, told AQ. “For many Ecuadoreans a vote for Lasso is a vote against ten years of correísmo rather than support for the Lasso himself and his policies.”

Nevertheless, Lasso has played his hand well. Fronting the center-right, pro-business CREO party, it was always likely that he would attract second-round support from the country’s other conservative and centrist voters. However, Lasso has been willing to sacrifice an element of his pro-investment credentials and promised new restrictions on mining projects in the country – proposing a ban on all projects in areas of exceptional biodiversity or at altitudes of over 2,800m (about 9,000 feet), and insisting that the neglected practice of consulta previa (prior consultation) with local communities will be respected under his mandate. 

This pledge seems pitched to win the support of left-wing parties and anti-mining groups. “Lasso’s declaration that he will not allow mining in biodiverse sites or in sources of water is a very enlightened position,” Carlos Zorrilla, head of Decoin, an NGO challenging the development of the Llurimagua copper project in the north of the country, told AQ via email.

Lasso’s use of the mining card exploits a key issue that has separated Correa from his indigenous support base and highlights the biggest policy U-turn of his presidency. Correa came to power as a resource nationalist, moving foreign oil companies onto less profitable contracts, tying up mining companies with new taxes and red-tape, and promising to protect the pristine Yasuni rainforest. Boosted by a greater state take and rising prices, oil sales came to account for 30 percent of government revenues. Correa then introduced ambitious social spending projects that resulted in a 27 percent fall in poverty levels in his first term. At 1 percent of GDP, foreign investment in Ecuador was the lowest in South America.

However, the rapid fall in the oil price from 2014 plunged the Ecuadorean economy into a liquidity crunch. At the 2016 price of $50 per barrel the state oil firm barely broke even, decimating funding for social programs. Correa’s solution was to court foreign investment, opening up Yasuni to Chinese oil firms and welcoming nearly $5 billion worth of investment from U.S. oil firm Schlumberger. He also cut taxes and loosened regulation on the country’s hitherto undeveloped mining industry, signing production contracts for a major new gold mine and easing the process by which mining firms can explore new territories. In return for new, more favourable contracts, the foreign firms agreed to make up-front payments to the state offset against future taxes and royalties, and these funds were used to pay pressing bills.

To add to the betrayal felt by indigenous and anti-mining groups, Correa made frequent trips to rural areas to lecture locals on the importance of mining to the country’s economic development. So pressing was the need for funds that he used his executive powers to fast-track new projects, bypassing the consulta previa process and sending in troops to shut down anti-mining protests.

Pachakutik’s Pérez was imprisoned three times for his role in organizing protests against the Quimsacocha gold project, owned by Canadian firm IMV Metals and located over 11,000 feet above sea level. “Our community takes water from Quimsacocha and we have resisted mining in the region by taking to the streets and demanding a free and independent consultation process with communities,” said Pérez. “The government simply militarizes the area and arrests protestors. Lasso’s support for the consultation process is an important reason that many Pachakutik supporters will vote for him in the second round.”

Indigenous people make up as much as 30 percent of Ecuador’s 16.5 million citizens, and their swing to Lasso could be the deciding factor in the run-off elections. In an ominous sign for Correa, the first round vote in Zumbahua – the location of his ceremonial inauguration and bastion of support in the 2006 and 2013 elections – Lasso won 44 percent of the votes to Moreno’s 29 percent.

The end of the commodities boom has forced Latin Americas left-wing governments to make difficult compromises in order to balance their books. Bolstered by strong approval ratings for much of his presidency, Correa has consolidated executive power and faced little domestic opposition. However, his attempts to develop Ecuador’s mining industry could seal the fate of his “Citizens Revolution.”

Youkee is an independent journalist and analyst based in Bogotá. Follow him on Twitter: @matyoukee.

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